An Education Guardian investigation has exposed how easy and cheap it is for UK university students to get small businesses to do their coursework. We posed as Josephine, a 23-year-old student who wanted two assignments done. One was her second-year undergraduate computer science homework. Another, for her "friend", was a second-year undergraduate history essay from a module on social and political thought.

We registered Josephine on an auction website - www.rentacoder.com - where business people across the globe, and a growing number of students, post work they need done and then wait for bidders to offer to do it by an agreed deadline. In under an hour, we had 11 bids for our computing assignment. Within two days, we had 38 bids from India, Argentina, Ukraine, Vietnam and the US. They wanted between $10 (£5) and $40 (£20) to do the work. In three weeks, 399 bidders had viewed our task.

We made no secret of the fact that Josephine was a university student intent on cheating. Our post on the site read: "This is my java programming assignment that I need help with. I'd like the solution to be as simple to follow as possible, with explanations, as my lecturer is going to ask me questions about it."

Another wrote: "We can discuss to get you prepared for the question your teacher is going to ask you. [sic]"

It took two days for three bidders to offer to write our history assignment for between $35 and $40. In three weeks, 198 bidders had looked at our post.

We chose a bidder in the US for our computing task. He was rated 8.83 - "superb" - by those who had previously used him on the site. We accepted a bidder in India for our history assignment. He was ranked 8.33 - or "very good".

We gave them two weeks to do the work. We then sent the assignments to be marked by the same history and computer science lecturers who had given us the tasks. We asked for Josephine to be marked as a normal student.

The computer science coursework barely scraped a pass at 40%. Our lecturer had to go back to Josephine six times to ask where unfinished parts of the task were. She, in turn, had to go back to her American "helper" to find out.

"I would have given the program code element of the coursework about 50%," says Bob Clarke, our lecturer in computer science, who works at Birmingham City University. "But with the notes and a bit of extra work included, Josephine would have barely passed with 40%."

Three-quarters of the history assignment turned out to be copied from an American history journal paper - immediate grounds for a university disciplinary action. The essay was put through plagiarism detection software Turnitin, as an estimated 90% of essays in UK universities are. About 70% of its text was identical to the journal article.

Our history lecturer, who works at a northern university and does not want to be named, says: "Anything that matches 18% and under is acceptable - that's just back titles and quotations. The real horrors are 50% and over."

So, a morality tale? Not quite. Josephine might not have got away with it, but there's considerable evidence to suggest thousands of UK students have.

Relatively few academics in the UK are aware of contract cheating - the term recently coined for students outsourcing their coursework on auction sites. Under lecturers' noses, UK students in the "low thousands" are estimated to be involved in the practice - and the figures have been rising since contract cheating spread here from the US in 2003.

The leading researchers in the field, Clarke and Dr Thomas Lancaster at Birmingham City University, predict there are double the number of contract cheats in UK universities there were a year ago.

Their studies have found that, on average, a contract cheat posts between four and seven assignments. To habitually cheat in this way suggests these students must be satisfied with the work they've paid for and must be getting away with it.

Why are contract cheats so hard to foil? It's partly a matter of originality.

Rentacoder warns bidders that the work they undertake should be their own, not copied from other sources as Josephine's essay was. Its website states: "In general, all deliverables must be completely your own original work and may not be taken (in whole or in part) from any work that you do not have full copyrights to."

And if it's original work that a student submits, it will go unnoticed by plagiarism detection software. Lecturers may be left to spot the Americanisms that have suddenly crept into a student's writing, or an overnight improvement in performance.

But that's not easy with today's large class sizes and the growth of anonymous marking. And Josephine's computing task was of poor quality. "If it had been first-class material, it would have been easy to spot, says Jenkins. "This way, it's harder to catch out the weaker students."

There is another way lecturers can catch out the contract cheats: detective work. Clarke has a radar to search auction sites all day and night for student coursework assignments. He's got 800 students from across the world on his "frequent offenders' list" - 20 of whom are from the UK. Once he finds what looks like university homework, he does his best to trace the student and contact their university. And he has had at least three students expelled so far.

Clarke admits his detective work encroaches on his weekends and evenings. "But I'm doing this because contract cheats devalue a university degree. Those who do it mustn't get away with it. It is not a victimless crime either. If a graduate has cheated in this way and their workplace finds they don't have the knowledge expected of them, all graduates of their university will be considered to be of poor quality."

Education Guardian called Rentacoder in Tampa, Florida, to ask whether it was aware university students used its site to get their coursework done. Its owner, Ian Ippolito, said yes: "Like many internet companies, we don't have the manpower to manually review 100% of postings," he says. "I actually spend considerable employee resources going through 50% of postings. When we see a project that involves taking a test for another person we remove it and inform the person why."

US privacy laws, under the Federal Communications Commission, forbid Rentacoder from divulging students' details to universities who spot their assignments on the site. But if a university sends Rentacoder a court order, it must oblige. Quite how it would work if a UK university sent a British court order is unclear. Ippolito says lecturers can monitor the site, as Clarke does, or set up Google Alerts of their assignments and allege copyright infringement if their words are used. That way the posts will be removed.

"It is a loophole used to overcome a loophole," Ippolito says. But ultimately, "professors have caught [cheating students] by simply testing for the same concepts in tests and exams. The same tactic works equally well today."

UK universities are waking up to the fact that a substantial minority of students are deceiving their university and themselves. Essay mill site UKEssays.com audaciously claimed last week that there are serious irregularities in the marks lecturers give students. One of its "guaranteed 2:1 history essays" received a 2:2 at Nottingham University and a first at Manchester University.

Clarke and Lancaster say it's time every lecturer in the country placed their assignments in a national database. That way, when an assignment is posted on an auction site it will be easy to trace the student it comes from. The UK's plagiarism advisory service says it's happy to help.

"That's fine," says Guy Haworth, a systems engineering lecturer at Reading University. "But an IT system is not going to solve this. There's a social dimension here; we've got to tell our students that they are here to learn, not to beat the system."

How to foil the contract cheat

Lecturers don't need to prowl auction websites day and night for familiar assignments to catch out the contract cheats. Here are some ways to cut out the detective work.

· Set up Google Alerts of the coursework you give. Google will email if it finds your title.

· When possible, ask students to explain tasks in person. Today's class sizes are too big to make this workable for all.

· To stop contract cheats in the first place, don't re-use assignments year after year. Stock answers will end up on the web.

· Personalise assessments instead, suggests Tim Roberts, author of Student Plagiarism in an Online World. Rather than set the essay "Write about the life and career of John Kennedy", he says ask students to "Compare the life and career of John Kennedy with that of a more recent US president". Likewise, don't set "Describe the plot of The Catcher in the Rye", but ask, "in what way is The Catcher in the Rye similar to your life experiences and in what way different?".

·Warn students before they hand in work that their efforts will be rigorously scanned by plagiarism detection kits.

· If your university hasn't already done so, suggest it updates its cheating policy so that it explicitly forbids the use of auction sites.

· Question the advantages of anonymous marking. Lecturers can only spot major changes in writing styles and dramatic improvements in work if students put their names to their assignments.